AMENDMENT NO. 1 AND WAIVER , dated as of May 14, 2002
BY AND AMONG
(1) BRANDPARTNERS, INC., a Delaware corporation ("BPG");
(2) XXXXXX BROTHERS INC., a New Hampshire corporation ("XXXXXX", and together
with BPG, individually a "COMPANY" and collectively, the "COMPANIES"); and
(3) CORPORATE MEZZANINE II, L.P., a British Virgin Islands limited partnership
("CMII").
WHEREAS, the Company and the Purchasers are parties to a certain Subordinated
Note and Warrant Purchase Agreement dated as of October 22, 2001 (the "ORIGINAL
PURCHASE AGREEMENT" and as amended hereby, the "PURCHASE AGREEMENT") pursuant to
which (i) Xxxxxx has issued and sold to CMII a subordinated promissory note (the
"NOTE") in the original principal amount of $5,000,000 with a final maturity of
October 22, 2008 and (ii) BPG has issued and sold to CMII certain warrants for
the purchase of 450,000 shares of common stock of BPG; and
WHEREAS, Xxxxxx has requested that CMII amend the Original Purchase Agreement in
certain respects and waive certain provisions of the Original Purchase Agreement
as specified herein, and BPG has joined in the request, and
WHEREAS, CMII is willing to waive and amend certain provisions of the Original
Purchase Agreement, but only on the terms and conditions set forth in this
Agreement;
NOW, THEREFORE, for good and valuable consideration, the receipt and sufficiency
of which is hereby acknowledged, the parties hereto agree as follows:
1. Definitions. Capitalized terms used in this Agreement shall have the
meanings given them in the Original Purchase Agreement unless otherwise defined
herein.
2. Acknowledgement of Defaults and Affirmation of Original Purchase
Agreement.
(a) Xxxxxx acknowledges that each of the Original Purchase Agreement
and the Note is a valid and binding obligation of the Companies, in the case of
the Original Purchase Agreement and of Xxxxxx, in the case of the Note,
enforceable against the Companies or Xxxxxx, as the case may be, in accordance
with its terms.
3. Waiver.(a) Effective as of March 31, 2002, but subject to the
satisfaction of the conditions precedent set forth in Section 5 hereof, CMII
waives compliance with the covenants set forth in Section 8.3(a), 8.3(b), 8.3(c)
and 8.3(d) of the Original Purchase Agreement as at, or for the applicable
period ending on, March 31, 2002. Anything herein to the contrary
notwithstanding, CMII's waiver contained in this Section 3 only applies to the
specific violations and provisions noted above and Xxxxxx is required to comply
with the provisions noted above, as amended by this Agreement, at all times in
the future.
(b) CMII confirms that subject to the satisfaction of the conditions
precedent set forth in Section 5 hereof, CMII waives the application of the
interest rate specified in Section 2(b) of the Note prior to the date hereof, it
being agreed that prior to the date hereof the interest rate applicable to the
Note shall be the rate specified in Section 2(a) of the Note.
4. Amendments. (a) Section 8.3(a) of the Original Purchase Agreement is
amended and restated as follows: "Xxxxxx shall maintain a ratio of Total Debt to
EBITDA of less than or equal to 4.2:1 for the period of twelve trailing months
ending on each fiscal quarter during the term of this Agreement."
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(b) Section 8.3(c) of the Original Purchase Agreement is amended and
restated as follows: "Xxxxxx shall not permit the Interest Coverage Ratio for
any period of four consecutive fiscal quarters ending on the last day of any
fiscal quarter during the term of this Agreement to be less than 2.1:1."
5. Conditions to Purchaser's Obligations. The amendments contained in
Section 4 hereof and the waiver contained in Section 3 hereof shall not become
effective until the date (the "EFFECTIVE DATE") on which CMII shall have
executed and delivered a counterpart of this Agreement and CMII shall have
received a counterpart of this Agreement executed and delivered by each Company.
6. Reimbursement of Expenses. Xxxxxx will pay all out-of-pocket expenses,
costs and charges incurred by CMII (including reasonable fees and disbursements
of counsel) in connection with the preparation and implementation of this
Agreement, and all documents executed in connection herewith.
7. Original Purchase Agreement and Note to Remain in Force. Except as
specifically provided herein, the Original Purchase Agreement and the Note shall
remain in full force and effect and are in all respects hereby ratified and
affirmed. From and after the Effective Date, all references in the Purchase
Agreement to "this Agreement", "hereof" or "herein" or the like, and all
references in the other Transaction Documents to the Purchase Agreement, shall
mean and refer to the Original Purchase Agreement as amended and waived hereby.
8. Successors and Assigns. The Agreement shall inure to the benefit of and
be binding upon the parties hereto and their successors and assigns.
9. Counterparts. This Agreement may be executed in counterparts, each of
which shall constitute an original and all of which, taken together, shall
constitute one and the same agreement.
10. Headings. The headings in this Agreement are for convenience of
reference only and shall not limit or otherwise affect the meaning hereof.
11. No Implied Waivers. No failure or delay on the part of CMII in
exercising any power or right hereunder shall operate as a waiver thereof, nor
shall any single or partial exercise of any such right or power preclude any
other or further exercise thereof or the exercise of any other right or power
hereunder or under the Original Purchase Agreement or the Note. No modification
or waiver of any provisions of this Agreement shall in any event be effective
unless the same shall be in writing and signed by CMII, and then such
modification, waiver or consent shall be effective only in the specific instance
and for the purpose for which given.
12. Governing Law. This Agreement shall be governed by and construed in
accordance with the laws of the State of New York, without regard to principles
of conflicts of law other than Section 5-1401 of the General Obligations Law of
the State of New York.
13. Jurisdiction; WAIVER OF RIGHT TO JURY TRIAL. Each party to this
Agreement hereby irrevocably agrees that any legal action or proceeding arising
out of or relating to this Agreement or any agreements or transactions
contemplated hereby may be brought in the courts of the State of New York
located in New York City or of the United States of America for the Southern
District of New York and hereby expressly submits to the personal jurisdiction
and venue of such courts for the purposes thereof and expressly waives any claim
of improper venue and any claim that such courts are an inconvenient forum. TO
THE EXTENT NOT PROHIBITED BY APPLICABLE LAW WHICH CANNOT BE WAIVED, EACH PARTY
HEREBY WAIVES, AND COVENANTS THAT IT WILL NOT ASSERT (WHETHER AS PLAINTIFF,
DEFENDANT OR OTHERWISE), ANY RIGHT TO TRIAL BY JURY IN ANY FORUM IN RESPECT OF
ANY ISSUE, CLAIM, DEMAND, ACTION, OR CAUSE OF ACTION ARISING OUT OF OR BASED
UPON THIS AGREEMENT OR THE SUBJECT MATTER
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HEREOF. EACH OF THE PARTIES HERETO ACKNOWLEDGES THAT THIS WAIVER IS A MATERIAL
INDUCEMENT TO ENTER INTO A BUSINESS RELATIONSHIP, THAT EACH HAS ALREADY RELIED
ON THIS WAIVER IN ENTERING INTO THIS TRANSACTION, AND THAT EACH WILL CONTINUE TO
RELY ON THIS WAIVER IN ITS RELATED FUTURE DEALINGS.
14. Severability. In the event that any one or more of the provisions
contained herein, or the application thereof in any circumstance, is held
invalid, illegal or unenforceable in any respect for any reason, the validity,
legality and enforceability of any such provision in every other respect and of
the remaining provisions hereof shall not be in any way impaired, unless the
provisions held invalid, illegal or unenforceable shall substantially impair the
benefits of the remaining provisions hereof.
[Remainder of Page Left Intentionally Blank]
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IN WITNESS WHEREOF, the parties have caused this Amendment to be duly
executed all as of the day and year first above written.
BRANDPARTNERS GROUP, INC.
By: /s/
-------------------------------------
Name:
Title:
XXXXXX BROTHERS, INC.
By: /s/
-------------------------------------
Name:
Title:
CORPORATE MEZZANINE II, L.P.
By: /s/
-------------------------------------
Name:
Title:
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AMENDMENT NO. 2 AND WAIVER , dated as of August 9, 2002 (this "AMENDMENT")
BY AND AMONG
(1) BRANDPARTNERS, INC., a Delaware corporation ("BPG");
(2) XXXXXX BROTHERS INC., a New Hampshire corporation ("XXXXXX", and together
with BPG, individually a "COMPANY" and collectively, the "COMPANIES"); and
(3) CORPORATE MEZZANINE II, L.P., a British Virgin Islands limited partnership
("CMII").
WHEREAS, the Companies and CMII are parties to a certain Subordinated Note and
Warrant Purchase Agreement dated as of October 22, 2001 as amended by that
certain Amendment No. 1 and Waiver dated as of May 14, 2002 (the "ORIGINAL
PURCHASE AGREEMENT" and as amended hereby, the "PURCHASE AGREEMENT") pursuant to
which (i) Xxxxxx has issued and sold to CMII a subordinated promissory note (the
"NOTE") in the original principal amount of $5,000,000 with a final maturity of
October 22, 2008 and (ii) BPG has issued and sold to CMII certain warrants for
the purchase of 405,000 shares of common stock of BPG; and
WHEREAS, Xxxxxx has requested that CMII amend the Original Purchase Agreement in
certain respects and waive certain provisions of the Original Purchase Agreement
as specified herein, and BPG has joined in the request; and
WHEREAS, CMII is willing to waive and amend certain provisions of the Original
Purchase Agreement, but only on the terms and conditions set forth in this
Amendment.
NOW, THEREFORE, for good and valuable consideration, the receipt and sufficiency
of which is hereby acknowledged, the parties hereto agree as follows:
1. Definitions. Capitalized terms used in this Amendment shall have the
meanings given them in the Original Purchase Agreement unless otherwise defined
herein.
2. Affirmation of Original Purchase Agreement. Xxxxxx acknowledges that
each of the Original Purchase Agreement and the Note is a valid and binding
obligation of the Companies, in the case of the Original Purchase Agreement and
of Xxxxxx, in the case of the Note, enforceable against the Companies or Xxxxxx,
as the case may be, in accordance with its terms.
3. Waivers.
(a) Effective as of June 30, 2002, CMII hereby waives compliance
with the covenants set forth in Section 8.3(a), 8.3(b), 8.3(c) and 8.3(d) of the
Original Purchase Agreement as at, or for the applicable period ending on, June
30, 2002.
(b) CMII hereby waives compliance with the covenants set forth in
Section 8.3(a), 8.3(c) and 8.3(d) of the Original Purchase Agreement as at, or
for the applicable periods ending on, September 30, 2002 and December 31, 2002.
Anything herein to the contrary notwithstanding, (i) CMII's waivers
contained in this Section 3 are subject to the satisfaction of the conditions
set forth in Section 5 hereof, (ii) such waivers only apply to the specific
violations and provisions noted above and (iii) Xxxxxx is required to comply
with the provisions noted above, as amended by this Amendment, at all times in
the future.
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4. Amendment. Section 8.3(b) of the Original Purchase Agreement is amended
by adding the following phrase immediately prior to the period at the end of
Section 8.3(b): "; provided that at the end of the fiscal quarters ending on
September 30, 2002 and December 31, 2002, respectively, Xxxxxx shall have a
minimum EBITDA of not less than $1 for each such fiscal quarter".
5. Conditions to CMII's Obligations. The amendment contained in Section 4
hereof and the waivers contained in Section 3 hereof (i) shall not become
effective until the date (the "EFFECTIVE DATE") on which CMII shall have
executed and delivered a counterpart of this Amendment and CMII shall have
received a counterpart of this Amendment executed and delivered by each Company
and (ii) shall remain in effect only so long as each of (x) the Senior Credit
Agreement and (y) the Purchase Agreement shall remain in full force and effect.
6. Reimbursement of Expenses. Xxxxxx will pay all out-of-pocket expenses,
costs and charges incurred by CMII (including reasonable fees and disbursements
of counsel) in connection with the preparation and implementation of this
Amendment, and all documents executed in connection herewith.
7. Senior Credit Agreement Amendment. Section 13 of the Third Amendment
and Waiver Agreement to the Senior Credit Agreement dated as of March 29, 2002
(the "THIRD AMENDMENT"), provides certain restrictions on the ability of Xxxxxx
to make payments of principal of and interest on the Notes. These provisions
appear to conflict with the Subordination Agreement. This will confirm that CMII
does not consent to the provisions of such section 13 to the extent such
provisions are inconsistent with the Subordination Agreement. By signing below,
Xxxxxx confirms and agrees that it will make payments under the Notes to the
extent required by the terms of the Notes and permitted by the Subordination
Agreement.
8. Original Purchase Agreement and Note to Remain in Force. Except as
specifically provided herein, the Original Purchase Agreement and the Note shall
remain in full force and effect and are in all respects hereby ratified and
affirmed. From and after the Effective Date, all references in the Purchase
Agreement to "this Agreement", "hereof" or "herein" or the like, and all
references in the other Transaction Documents to the Purchase Agreement, shall
mean and refer to the Original Purchase Agreement as amended and waived hereby.
8. Successors and Assigns. The Agreement shall inure to the benefit of and
be binding upon the parties hereto and their successors and assigns.
9. Counterparts. This Amendment may be executed in counterparts, each of
which shall constitute an original and all of which, taken together, shall
constitute one and the same agreement.
10. Headings. The headings in this Amendment are for convenience of
reference only and shall not limit or otherwise affect the meaning hereof.
11. No Implied Waivers. No failure or delay on the part of CMII in
exercising any power or right hereunder shall operate as a waiver thereof, nor
shall any single or partial exercise of any such right or power preclude any
other or further exercise thereof or the exercise of any other right or power
hereunder or under the Original Purchase Agreement or the Note. No modification
or waiver of any provisions of this Amendment shall in any event be effective
unless the same shall be in writing and signed by CMII, and then such
modification, waiver or consent shall be effective only in the specific instance
and for the purpose for which given.
12. Governing Law. This Amendment shall be governed by and construed in
accordance with the laws of the State of New York, without regard to principles
of conflicts of law other than Section 5-1401 of the General Obligations Law of
the State of New York.
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13. Jurisdiction; WAIVER OF RIGHT TO JURY TRIAL. Each party to this
Amendment hereby irrevocably agrees that any legal action or proceeding arising
out of or relating to this Amendment or any agreements or transactions
contemplated hereby may be brought in the courts of the State of New York
located in New York City or of the United States of America for the Southern
District of New York and hereby expressly submits to the personal jurisdiction
and venue of such courts for the purposes thereof and expressly waives any claim
of improper venue and any claim that such courts are an inconvenient forum. TO
THE EXTENT NOT PROHIBITED BY APPLICABLE LAW WHICH CANNOT BE WAIVED, EACH PARTY
HEREBY WAIVES, AND COVENANTS THAT IT WILL NOT ASSERT (WHETHER AS PLAINTIFF,
DEFENDANT OR OTHERWISE), ANY RIGHT TO TRIAL BY JURY IN ANY FORUM IN RESPECT OF
ANY ISSUE, CLAIM, DEMAND, ACTION, OR CAUSE OF ACTION ARISING OUT OF OR BASED
UPON THIS AMENDMENT OR THE SUBJECT MATTER HEREOF. EACH OF THE PARTIES HERETO
ACKNOWLEDGES THAT THIS WAIVER IS A MATERIAL INDUCEMENT TO ENTER INTO A BUSINESS
RELATIONSHIP, THAT EACH HAS ALREADY RELIED ON THIS WAIVER IN ENTERING INTO THIS
TRANSACTION, AND THAT EACH WILL CONTINUE TO RELY ON THIS WAIVER IN ITS RELATED
FUTURE DEALINGS.
14. Severability. In the event that any one or more of the provisions
contained herein, or the application thereof in any circumstance, is held
invalid, illegal or unenforceable in any respect for any reason, the validity,
legality and enforceability of any such provision in every other respect and of
the remaining provisions hereof shall not be in any way impaired, unless the
provisions held invalid, illegal or unenforceable shall substantially impair the
benefits of the remaining provisions hereof.
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IN WITNESS WHEREOF, the parties have caused this Amendment to be duly
executed all as of the day and year first above written.
BRANDPARTNERS GROUP, INC.
By: /s/
-------------------------------------
Name:
Title:
XXXXXX BROTHERS, INC.
By: /s/
-------------------------------------
Name:
Title:
CORPORATE MEZZANINE II, L.P.
By: /s/
-------------------------------------
Name:
Title:
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